Bitcoin: The Phenomenon Explained

If you haven’t heard of bitcoin yet, you are living under a rock. It seems to be the only thing anyone in tech talks about nowadays as the new cryptocurrency has been all the buzz.

A year ago today, Bitcoin was just a small trend, and a single coin was valued at $775. Today it is now valued over $15,000 for a single bitcoin, and you can’t go a whole day without hearing about this crazy new phase.

Although there is so much talk behind the infamous bitcoin, it seems that no one fully understands what a bitcoin actually is or the technology behind it making the digital currency work.

What is Bitcoin?

Today we use a system that allows us to buy goods or services based on a structure ran by governments, banks, and credit card companies. You might think the current system is pretty good, but what most of us fail to realize is that these banks, governments, and credit card companies are all taking a little piece of every transaction we make. Not only that, but we also put our blinded trust into these organizations that this system will always remain working and secure.

Unlike the the current system, Bitcoin aims to create a payment method without that middle man. It is completely decentralized where you no longer have to rely on banks or credit card companies. But how exactly can you prove you pay for something without someone certifying you did?

Bitcoin solves this issue as well through a universal ledger system. Instead of an entity controlling the transaction on one single ledger, bitcoin’s system gives the ledger to everybody every time there is a new transaction. This is called blockchain, and it allows for total autonomy from any single user or organization. Furthermore, it becomes practically impossible for someone to manipulate the currency or value as it literally gives power to all bitcoin holders in the system.

Behind the Cryptocurrency Craze

Bitcoin just didn’t appear out of nowhere. There are several different factors that catalyzed its sudden rise to its current day value.

1. Media Coverage

Probably the single most contributing factor to the insane rise in the value has to deal with the significant increase in overall media coverage. It started out in just small online forums and communities of techies interested in the idea of cryptocurrency and blockchain.

Now, every single major broadcasting network reports on the sudden developments. It’s almost becoming a household topic of discussion for people of all ages.

You know it is coming particularly a big deal when your grandparents begin asking you what a bitcoin is and how do you buy it.

2. Growing Acceptance of its Legitimacy

The media coverage became a result of the shockingly rising prices, but what also contributed to the rise was the growing acceptance of the legitimacy of the currency. It first was used solely on the black market for immoral goods and services, but the growing popularity has peaked interests of major countries around the world as they look for ways to incorporating crypto into their current economies.

Japan became the first of these major countries to legalize bitcoin as a payment method on April 1, 2017, and now over 250,000 shops accept bitcoin as a legitimate business payment. This created a huge demand for bitcoin at the beginning of the year.

As Japan began to adopt it in their everyday lives, other countries began to follow suit as Russia authorities are considering legalizing the cryptocurrency in 2018 in an attempt to curb money laundering. India also has been looking into the possibility of introducing bitcoin to their current economy.

3. Continued Strength

All of this has been possible by the continued strength of the growing value of Bitcoin. Although the digital currency has had its volatile moments, it continues to receive reliable predictions from experts in the field of technology and cryptocurrency such as Jeremy Liew, the first investor in Snapchat, and Blockchain CEO Peter Smith.

The currency continues to trade at elevated levels, and more predictions from these experts are still out there. Both Jeremy and Peter believe that bitcoin hasn’t even reached its final potential, and go further to believe one bitcoin could be worth as much as $500,000 by the year 2030.

The Future of Bitcoin & Cryptocurrency

It is easy to get lost in the craze we are currently in. We here insane success stories such as the dutch family who sold everything from their house to their shoes to invest in the popular cryptocurrency last spring, and now the family has millions of dollars.

At the end of the day, people need to realize there is a considerable amount of risk when it comes to investing in cryptocurrency. The influence of major investors and regulatory actions by governments has already defeated the initial purpose of bitcoin, and there are many crucial steps that need to happen for it to become 100% legitimate.

Although we at Seamgen would love to see the continued success of cryptocurrency, the sad truth is Bitcoin is temporary. Quantum computing, once perfected, will inevitably kill Bitcoin and all other cryptocurrencies as the advances in quantum technology could break the entire system that we are just beginning to trust.

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Nice!

You’ve made a wise decision. Emails are sent out about once a month, so keep your eyes peeled. Look for a monthly roll up from us on what we’re up to and the latest in technology, design & industry trends.